Helping someone with mortgage problems

When you want to help

Some people will turn to family or friends for advice and assistance when they are under financial pressure and need help. The most important thing you can do is to be calm, positive and practical.

Here are some simple ways you can help a family member or friend with their mortgage problems.

Signs someone might need your help

Even if your friend or family member has not asked for your help, you may be able to assist them anyway.

Here are some signs that they could be struggling with their mortgage and may need your help:

  • They dramatically reduce their spending
  • They struggle to pay their bills on time
  • They use their credit card to pay bills, increase their credit limit or apply for more credit cards
  • They worry about a potential interest rate rise
  • They look for a second job
  • They downsize their home or sell their car to get some spare cash
  • They ask if they can borrow some money

If you notice your friend or family member is becoming anxious or depressed, encourage them to see a doctor or get help from support services. For free and confidential telephone counselling and emotional support contact Lifeline or Beyond Blue.

Give support not lectures

If someone is in financial difficulty, it is important that they do not feel they are being judged. Most people will experience financial problems at some stage in their lives. Lecturing them about what they could have or should have done might make them avoid their financial problems.

Work with them to look at what practical steps they can take to fix their financial issues.

Help them to create a budget

Encourage them to create a budget. If they monitor their spending they will more easily be able to keep up with their mortgage repayments. 

Work out where your money is going.

Budget planner

 For more tips see how to do a budget.

Get them to talk to their lender

The best thing you can do for someone struggling with their mortgage is to encourage them to talk to their lender. Their lender must assess and respond to their request. The sooner they speak to their lender, the more options they will have.

If appropriate, and with their agreement, you could offer to speak to the lender on their behalf to find out what options are open to them. Their lender will tell you what form they would need to sign to give you this authority.

What support you give beyond that depends on whether they are struggling to keep up with their mortgage, have missed a mortgage repayment or are behind on their mortgage.

Encourage them to see a financial counsellor

Financial counsellors offer a free, confidential service to help people sort out their money problems. They can help your friend or family member to negotiate with their lender. See financial counselling for more details.

Should you lend them money?

Lending money to a family or friend can help them deal with their immediate financial situation. But if their money issues are long term, adding to their debt in this way may make their problems even worse.

They will owe money to the bank and to you, and may have no way of paying you back. See loans involving family and friends.

If you can assist your family member or friend deal with their mortgage problems you could help them avoid losing their home. Start the conversation with them to see how you can aid and support them along the path to financial recovery.

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Last updated: 31 Jan 2017